General Standard Terms and Conditions

of NEC Display Solutions Europe GmbH

§ 1 General

(1)

These General Standard Terms and Conditions apply to all deliveries and provision of services - also in the future - by NEC Display Solutions Europe GmbH (“NEC”) to entrepreneurs as defined in § 14 BGB (German Civil Code), with whom NEC maintains business relations (hereinafter named "customer"). The German version of NEC’s General Standard Terms and Conditions is solely applicable for customers with place of business in Germany or Austria. The German version is also solely authoritative for interpretation of these Standard Terms and Conditions. It can be downloaded at www.nec-display-solutions.com.

(2)

NEC does not accept any deviating or contradictory terms and conditions referred to or otherwise imposed by the customer, unless otherwise expressly agreed between the parties in writing. These general terms and conditions also apply in case NEC makes deliveries or provides services to the customer without reservations while being aware of such deviating or contradictory terms and conditions.

§ 2 Quotations

All quotations are always subject to change without notice, unless expressly stated otherwise in the order confirmation by NEC. NEC reserves the right to technical alterations and changes of shape and color to the extent the customer may reasonably be expected to accept these.

§ 3 Acceptance of orders

Purchase Orders and other orders are binding on the customer. NEC is, however, not obligated to accept any purchase orders or other orders. NEC may accept such offer of a contract incorporated in such order or assignment within two weeks after receipt by NEC. Such commitment becomes binding on NEC only after explicit written acceptance (acknowledgement of order). NEC may omit the acknowledgement of order in case of immediate delivery or performance.

§ 4 Prices and terms of payment

(1)

NEC's prices are net “EXW” (Incoterms 2000) including normal packaging but excluding all shipment costs. All prices and incidental expenses, especially shipping costs, will be charged on the basis of the price list valid at the time the contract is concluded. Discounts must be agreed upon separately.

(2)

Legal VAT is not included in NEC's prices. Such VAT will be itemized in the invoice separately at the rate applicable on the day of invoicing.

(3)

NEC reserves the right to modify prices adequately if its subsuppliers modify prices after conclusion of the contract and shipment has not yet been made at the agreed delivery date. Upon request, NEC will document the price changes implemented by its subsuppliers.

(4)

Payments are due within 30 days after invoice date in cash and without any deductions. If the customer is in delay of payment, NEC shall be authorized to charge interest at the rate of 8 percentage points above the respectively valid base interest rate as defined in § 247 BGB. NEC reserves the right to put forward higher claims for damages caused by delayed performance.

(5)

Counterbalancing is only admissible with undisputed and legally effective counterclaims. The customer has also no right to retention based on counterclaims from other contractual relations.

(6)

All of NEC’s claims, including those for which payment in installments has been agreed, are due immediately. Any time allowed for payment is null and void if the date of required payment for settlement of a claim is not observed or the customer defaults on payment or the customer files for insolvency proceedings or the customer makes an oath of disclosure about his financial standing. In such case, NEC is also entitled to make deliveries outstanding only against advance payment or security furnishment. In case such advance payment or security furnishment is not effected within an appropriate period of time, NEC is entitled to terminate the contract without notice.

(7)

Irrespective of any deviating terms and conditions implemented by the customer, NEC is entitled to credit the customer’s payments first against prior debts, next against any incurred costs, next against interest, and last against the principal claim.

§ 5 EC-turnover tax on imports

(1)

To the extent the customer has his legal domicile outside the Federal Republic of Germany, the customer is obligated to observe the EC regulations on turnover tax on imports. The customer will notify NEC about his turnover ID number and any changes to such number without further request. Upon request, the customer will disclose information on his capacity as entrepreneur, use and transport of the delivered goods, and also for statistical reporting requirements.

(2)

The customer also agrees to reimburse NEC for any expended time and expenses NEC incurs in context with missing or inadequate particulars about turnover tax on imports.

§ 6 Period of delivery

(1)

Agreed delivery deadlines and the beginning of the delivery period stated by NEC are subject to timely receipt by NEC of correct deliveries from its suppliers. This applies only if NEC is not responsible for the failure to deliver, especially in case of congruent cover business with its supplier. NEC shall immediately inform the customer about the non-availability of performance and shall immediately refund payments made by the customer for the ordered products. Compliance by NEC with its delivery commitments is subject to the customer performing his obligations in a timely manner. NEC reserves the right to defense of non-performance of contract.

(2)

Should the customer default in accepting the delivery of goods or should he culpably violate any other duty to cooperate, NEC is entitled to demand reimbursement for any damages incurred by NEC in this context. Under the conditions stated above, the risk of coincidental ruination or coincidental deterioration of the object sold passes to the purchaser at the point at which he defaults in accepting the delivery of goods or at which he is in debtor’s delay.

(3)

Should the underlying purchase contract be a contract where time is of the essence as defined in § 323 sec. 2 No.2 BGB ( German Civil Code ) or in § 376 HGB ( German Commercial Code ), NEC is liable in compliance with statutory provisions. NEC is also liable in compliance with statutory provisions in case the purchaser due to NEC default of delivery is entitled to claim that his interest in further performance of contract has lapsed. In any case NEC's liability is restricted to foreseeable damages typical for this type of contract.

(4)

NEC is also liable in compliance with statutory provisions in case the default of delivery is caused by intentional or grossly negligent violation of contract within NEC's scope of responsibility. To the extent such default of delivery is not caused by intentional violation of contract within NEC's scope of responsibility, NEC's liability is restricted to foreseeable typical damages.

(5)

NEC is also liable in compliance with statutory provisions to the extent the default of delivery within its scope of responsibility is caused by culpable violation of essential contractual obligations. In this case, NEC's liability is restricted to foreseeable typical damages.

(6)

To the extent NEC’s default to deliver is caused solely by culpable violation of a nonessential contractual obligation, the customer is entitled to claim payment of a flat-rate compensation for default of delivery of 0.5% of the delivery value per full week of delay, however, no more than 5% of the delivery value. NEC is, however, not liable in case of slightly negligent negligence.

(7)

Customer's rights to other statutory claims and rights are not precluded.

§ 7 Shipment – passage of risk

(1)

Delivery is made ex NEC’s warehouse (EXW Incoterms 2000) for the account of the customer and at his risk unless stated differently in the acknowledgement of order. In case delivery free domicile is agreed, this will not affect the passage of risk.

(2)

(1) Risk passes to the customer when the object sold is transferred to the forwarding company or leaves NEC’s warehouse for the purpose of shipment. If such shipment is delayed due to circumstances within the customer’s scope of responsibility, the risk passes to the customer at the time he is notified of the readiness for shipment. In such case, NEC is, however, obligated to take out such insurance at the customer’s wish and expense as the customer desires. NEC is also entitled to invoice the incurred warehouse costs or a flat-rate sum of 0.5% of the invoiced value of goods per month. In this case, the contract price resp. other consideration is due for payment at the time the goods are ready for shipment.

(3)

NEC will insure the delivery by taking out a transport insurance policy at the customer’s request and expense.

§ 8 Warranty for defects

(1)

The product qualities shall principally be defined solely in NEC’s product specifications. Public statements, promotions or producer advertisements may not be construed to be contractual specifications of the product quality.

(2)

The customer is obligated to lodge written customer's complaint about obvious defects to NEC within a period of ten days following receipt of the goods; in other case, assertion of warranty claims for damages is excluded. The deadline will be considered observed if the complaint is mailed within the time stipulated.

(3)

In case of defects, NEC shall, at its discretion, furnish warranty by way of rework or replacement (supplementary performance).

(4)

Should such supplementary performance fail, the customer may at his discretion demand reduction of purchase price or withdrawal from contract. However, the right to claim rescission of contract is excluded for only minor contract breaches, specifically in case of insignificant defects.

(5)

In case customer opts for rescission of contract after supplementary performance failed, he is not entitled to any additional claims for damages due to the complained defect.

(6)

If the customer asserts claims for damages after failed supplementary performance, the goods remain with the customer, if such may reasonably be expected of him. Claims for damages are restricted to the difference between the purchase price and the value of the defective purchase item. This shall not apply if NEC fraudulently violated the contract.

(7)

The period of warranty shall be 12 months; such period shall start with the transfer of risk. Any claims the customer may have based on manufacturer's warranty shall remain unaffected.

§ 9 Industrial Property Rights

(1)

The customer agrees to notify NEC immediately if he becomes aware of infringement of third-party industrial or intellectual property rights (IPR) or is reprimanded for such.

(2)

If third parties assert claims due to alleged violation of IPR, the customer authorizes NEC to defend against the third party on its own. Should NEC make use of this authorization, the customer may not acknowledge the third party's claims without NEC’s written consent. NEC shall defend against the third party's claims at its own expense and will release the customer from all costs related to defense against these claims to the extent these are not based upon the customer's breach of duty.

§ 10 Liability

(1)

In case of slightly negligent violation of duties, NEC’s liability is restricted to predictable, contract-specific, direct average damage typical for the nature of its performance. In case of slightly negligent violation of nonessential contractual duties, NEC’s liability is excluded.

(2)

To the extent NEC’s liability for damages is excluded or restricted, this also applies in respect of the personal liability for damages of its salaried employees, wage earners, representatives, and persons employed by NEC in performing an obligation.

(3)

The above limitation of liability shall not apply to the customer's claims in compliance with the product-liability law and to claims due to injury or impairment of health or to loss of customer's life.

§ 11 Retention to ownership

(1)

NEC retains the ownership of the sold object until all payments from the business relation with the customer are received.

(2)

The customer is obligated to handle the sold object carefully; he is specifically obligated to appropriately insure the sold object at his own expense against fire and water damages and theft at reinstatement value. To the extent maintenance and inspection work is required, the customer will perform these at his own expense in due course.

(3)

In case of a seizure or any other interference by any third party, the customer shall immediately notify NEC to enable NEC to file a suit acc. to § 771 ZPO (German Civil Code). Should the third party be unable to reimburse NEC for the legal fees and out-of-court expenses for a legal action acc. to § 771 ZPO, the customer shall be liable for NEC’s financial loss.

(4)

In case of the customer’s breach of a contract, specifically in case of default of payment or violation of a duty as defined in sec. (2) and (3) of this contractual stipulation, NEC is entitled to cancel this contract and to demand surrender of possession of the goods.

(5)

The customer is authorized to resell the sold object in the course of its ordinary business. However, the customer already now assigns to NEC all claims in the amount of the invoice total of our claim (incl. VAT), which arise from reselling the sold object to his buyers or third parties irrespective of whether the sold object was resold in its original state or after further processing. The customer is authorized to collect this debt also after assignment. Our authority to collect the debt ourselves remains unaffected. NEC does, however, agree not to collect the debt as long as the customer meets his payments from the revenues collected, as long as the customer does not default on payment and specifically does not file for insolvency proceedings or the customer does not stop payments. Should, however, this be the case, NEC may request the customer to inform NEC about the assigned accounts receivable and their debtors, to provide NEC with all particulars required for collection, to surrender all required documentation, and to inform the debtors (third parties) about such assignment.

(6)

Processing or transformation of the sold object is always done for NEC. In case the sold object is combined with other objects not in NEC's possession, NEC acquires co-ownership in the new object corresponding to the ratio between the value of the sold object (amount of the invoice total incl. VAT) and the other processed objects at the time of such processing. The terms applying to object delivered under conditions also apply to the object created by way of processing.

(7)

Should the sold item be inseparably combined with other objects not in our possession, we acquire co-ownership in the new object corresponding to the ratio between the value of the sold object (amount of the invoice total incl. VAT) and the other combined objects at the time of such combination. If combination is performed with the effect that the customer’s object must be considered principal object, the parties agree that the customer assigns prorate co-ownership to us. The customer subsequently safeguards the ensuing sole ownership or co-ownership for us.

(8)

NEC agrees to release the collateral to which it is entitled upon request by the customer insofar as the realizable value of our collateral exceeds the claims to be secured by more than 10%. NEC is entitled to choose the collateral to be released.

§ 12 Place of jurisdiction, place of performance, applicable law

(1)

Place of jurisdiction for all disputes with fully-qualified merchants as defined in the HGB, legal entities under public law, or public-law special funds will be Munich. Munich is also place of jurisdiction if the customer has no general domestic place of jurisdiction, transfers his habitual residence or customary place of abode to a foreign country after the contract is concluded or if his habitual residence or customary place of abode are not known at the time the action is brought. NEC is, however, also authorized to bring action at the customer’s legal domicile.

(2)

Place of performance for NEC’s deliveries and other performances as well as for customer’s payments is the seat of NEC's principal establishment.

(3)

These Terms and Conditions and all legal relations between us and the customer are subject to the laws of the Federal Republic of Germany. Application of the Convention on the International Sales of Goods (CSIG) is excluded.